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UK CAR MANUFACTURING REACHES 10 YEAR HIGH

25th January 2016

The UK's car manufacturers produced 1,587,677 vehicles in 2015, a ten-year high, growth of 3.9 percent and overtaking pre-recession levels for the first time.

The data, released by the Society of Motor Manufacturers and Traders (SMMT) reveals that a record number of cars - representing 77.3 percent of total production - was for export, with 1,227,881 units leaving the UK, up 2.7 percent on 2014 levels.

Challenges were experienced in some global markets such as China, where demand fell by 37.5 percent, and Russia, where export volumes declined 69.4 percent. However, the economic recovery in Europe, the UK's biggest trading partner, boosted demand for UK-built cars considerably by 11.3 percent in 2015. The region now accounts for 57.5 percent of all UK car exports.

Appetite for British-built cars grew significantly in other key and emerging regions, says SMMT, demonstrating the strength and diversity of UK manufacturing and product. In the US, demand rose by more than a quarter (26.5 percent), making it the UK's biggest trading destination outside the EU, ahead of China. Meanwhile, notable growth was also seen in Australia, South Korea, Turkey and Japan.

British consumer and business demand for British-made cars also contributed to last year's success, with the home car market rising 8.1 percent on the previous year. One in seven new cars registered in the UK in 2015 was made in Britain.

"Despite export challenges in some key markets such as Russia and China, foreign demand for British-built cars has been strong, reaching record export levels in the past year. Achieving these hard fought for results is down to vital investment in the sector, world class engineering and a committed and skilled UK workforce - one of the most productive in the world," explained Mike Hawes, SMMT Chief Executive.

Chancellor of the Exchequer George Osborne said: "Our plans to rebalance the economy mean we have to continue to build on our great manufacturing strengths in the Midlands and the North of England, and work together to ensure that Britain continues to prosper as a global leader in car production."

The performance of UK automotive is very different compared with UK manufacturing as a whole, according to Office for National Statistics figures, which show the average manufacturing output to have slowed in recent months. Eight brand new car models were produced in UK plants in 2015, and with £2.5 billion of fresh investment committed to the sector in 2015, more are set to follow in the coming months.